How Much Do Youtube Ads Cost?

Video Transcript:

Youtube ads can be really effective for your business, but how much do they cost? We’re going to get into all of it and we’re starting right now.

Now, my goal for this video today is by the end of it, you’re going to know exactly what to expect in terms of Youtube ads cost as well as all the different factors that make a difference when you’re talking about what you’re gonna pay. So basically right now there’s a lot of talk about Facebook ads, but the thing is the prices for Facebook ads are pretty much skyrocketing.

Yet Youtube remains a very affordable way to pinpoint your ideal customer with lots of really interesting targeting options. Now, what I like best about Youtube ads is you really only pay for them when you know someone has viewed it, usually for 30 seconds or more.

Compare that with Facebook where they define a view is three seconds, which is pretty useless when you think about it. You’re not really going to get your brand out there in three seconds. Now it’s important to know that Youtube ads are basically a bidding system just like Facebook, so you can basically set the total amount you’re willing to pay per view as well as setting a daily cap or a lifetime budget for the ad. So after you’ve done your targeting, so you know exactly what group of people are going to be eligible to see your ad. So whenever someone in your targeted group watches a monetize video, a Youtube algorithm goes to work and they basically way your bid, the highest price you’re willing to pay for the video against how relevant they think your video is going to be to the viewer.

So right now I want to start by talking about the different factors that are going to play a part and then we’ll finish the video off with some really ballpark estimates of what you can expect to actually pay. Okay, so the first contributing factor here is targeting. So think of it this way, the more granular you’re targeting gets meaning the smaller the group is, the more you can expect to pay in general. So if you show your ad to a really large group like just everybody in the United States, your costs will generally be lower because Youtube is probably just going to show your ad to the people that nobody else has really advertising to. On the opposite end, if you get really specific, it’s going to drive your cost up because basically now you’re competing against a bunch of other advertisers that may be running ads to that same group of people.

It might help to think of this like a dating app. So let’s say you’re willing to go out with just about anybody on the APP while you’re probably going to get a lot of dates that way, but the pickier you are, and if you’re only willing to go out with those nines and tens, a, you’re gonna have a lot more competition for those people. So it works the same way in the auction system with Youtube ads. Okay? So the next contributing factor is the placement of the ad. You know, where on Youtube is your ad being shown? Um, I’m going to talk first about the instream Trueview ads, which is basically probably what you think of when you think of a Youtube ad. It’s the ad that runs before a video that you can skip after five seconds. Now the thing that I really like about these instream ads is if the viewer skips it in five seconds, you’re not charged for it.

In fact, they have to watch up to 30 seconds of the ad before you are ever charged for it and less. Here’s the caveat. If your ad is under 30 seconds, so let’s say you wanted to try to beat the system and make an ad that’s only 29 seconds in that case, if they were to finish the ad at 15 seconds, if it’s done then or 20 seconds, if it’s done, then you’re still charged for it. So for that reason you’re definitely gonna want to make your ad more than 30 seconds. Okay, so the next type of ad are called discovery ads. So think about these are the search engine results within Youtube. So if someone were to type in a keyword phrase about dog training and it came up as a clickable thumbnail, either in those search results or if someone’s watching another video and it shows up in the right sidebar as a related video.

Now these ads are charged a little bit differently because they’re not automatically shown to a viewer. They have to click on them. So here’s the thing, anytime anyone clicks on those ads, you’re charged for it, regardless of how long they watch it for. The next kind of ad is a non skippable in stream ads. So these are the ads that are really annoying, that come before a video that you don’t have the opportunity to skip a. usually these are 15 to 20 seconds and they’re pretty much dominated by the big brands like Geico or movie trailers. Now these kinds of ads are mostly for brand awareness, like, like I said, from larger companies, I actually do not recommend them. For small businesses, they’re very expensive and the fact that you can’t really skip them means you’re probably just going to generate more bad we’ll toward your business than good.

And the thing that’s really important to remember is you actually want people to skip your ad if they’re not qualified to be your customer. When people who aren’t interested, skip your video, you’re basically then only paying for people that are interested. So it’s actually a great way to save some money and really qualify your prospects. A lot of times they actually recommend saying in the very beginning of the video, either verbally or through text on the screen. If you’re not interested in fill in the blank. Just go ahead and skip this video. We actually recently did a video like this for the deep end. We’re in the very beginning. We said, if you’re not interested in a new website that’s going to bring you more customers for your business, just go ahead and skip it. You know, it doesn’t really make a lot of sense for us to advertise to people who aren’t actually looking for a new website.

And the other advantage of saying something like this in the beginning is not only do you weed out the people who aren’t interested, but you’re kind of specifically calling out the people who are interested, letting them know that this video is actually 100 percent for them that gets their attention and makes them actually stick around to watch much more of the video. Now, there are a few things to keep in mind here. So basically those instream ads run before another video. Those work okay as a promotional video. But I would never recommend doing a promotional branding video as a discovery ad because remember, you’re paying every time someone clicks on one of those discovery ads. So, uh, once they figure out that that is a pure commercial for your business, they’re are going to get right out of there and you’re still going to have to pay for that click.

So what actually recommend if you’re doing those discovery ads, you need to make them purely value based content based that really fills the search that they were looking for. So if someone’s looking for how to fix a clogged sink, you’re not going to want to bait and switch them into an ad for your plumbing business. You’re gonna want to actually show them how to fix the clogged sink. And then at the end of that video, you can end it with a call to action. Like you might say, if you need help with any of this, go ahead and give us a call so you’re still delivering value and also getting your call to action in there at the very end. And it also encourage you to think of ways you can get your brand name within the first five seconds of one of those instream ads before they’re allowed to skip it.

Getting these brand mentions of your business can be really valuable on its own, especially if people are seeing the ad multiple times. So basically this is a way to cheat the system a little bit and actually get people to hear the name of your brand even if they’re not viewing the video, which means you’re getting all that attention for free. Okay, so now that you know all the different factors and considerations that go into how much your Youtube ads we’re going to cost, let’s talk about numbers and exactly what you might expect to pay. And as you may expect, there is a range here. I can’t really tell you the specific number, but I can say I’ve seen them as low as one to two cents per view. I’ve actually gotten that for the deep end, but to be honest with you, that generally ends up settling somewhere more in the four cent per view range and that’s targeting people who are in market for a new website in the US between the ages of 35 and 65.

So what I did was I set a bid of twelve cents per view, but it ended up costing only around four, but the standard is more in that 10 to thirty cent range. So why were the deep ends adds so much lower than that considering how tight the targeting was? Well, I believe it has something to do with what they call the quality score, meaning the more people watch her out and the longer people watch your ad, the lower the cost is going to be because they basically determined that this ad is very relevant to that audience. So they feel better showing it to them knowing that their user experience is going to be better at. Our ads had really high watch rates of around 75 percent. Most of the time that average is more around 20 to 30 percent. And the reason I think it was so high for us, these were mostly value based videos, not purely promotional.

And we’ve really got our targeting right. So that’s why it’s really important to set your targeting correctly so that the people that are viewing your ad are definitely looking for the service or product you provide. You know someone’s actually in the market for an interior designer and then there you are with your interior design tips in front of them. People are naturally going to pay attention to that because it’s really important to them in the moment and of course, as with all advertising in the end, the only thing that really matters is the ROI it brings in. And Youtube ads are a great way to introduce your business to your customers. Let them get to know you and your process. This builds trust and with multiple impressions, people are really going to start to think about you and your business when they need exactly what you can provide them.

Okay, so now I want to hear from you and I want to know what kind of Youtube ad you’re thinking about running. So just leave it in the comments below along with any questions you have about any of this. I will read all of them and answer as many as I can.

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